Essays on globalization, skills and development

This dissertation examines how globalization, defined as increase in trade or Foreign Direct Investment (FDI), influences development in terms of economic growth and labor market effects. It also studies the role of human capital in affecting economic development both directly and interacting with globalization variables. The dissertation consists of four chapters: one macroeconomic study that revisits the impacts of globalization and education on economic growth (Chapter 1) and three micro-level case studies on Vietnam's labor market. One micro paper explores the impacts of FDI on wages (Chapter 2), another investigates the impacts of FDI on internal migration (Chapter 3), and the final study explores the effects of export liberalization on Vietnam's skill premium (Chapter 4).;The dissertation's findings broadly support the view that globalization can be an "engine of growth", but its mechanisms are complex. One insight from the macro study is a positive impact of trade and FDI on capital formation on average in developing countries. The micro studies for the case of Vietnam suggest that the labor market is another channel through which globalization may bring growth where it spurs employment, raises wages and brings about interregional labor migration. The macro study also reveals a strong and positive direct impact of education on economic growth, which in turn is consistent with the results of the micro studies. The dissertation provides evidence that globalization and skill variables interact in ways that vary depending on different channels and specific episodes of trade liberalization. For instance, whereas foreign firms generally pay higher foreign wage premiums for better educated workers, they also play a role in raising wages of less skilled women relative to alternative jobs in the informal wage sector. In the aftermath of the U.S.-Vietnam Bilateral Trade Agreement, Vietnam's provinces which are more exposed to the increase in export opportunities experienced a larger wage growth for unskilled workers and a decline of the skill premium relative to the other provinces. However, as Vietnam's economy-wide skill premium increased during the period studied, the latter effect appeared to have mitigated but did not outweigh the other effects which raised the skill premium.